Citation Nr: 18147835 Decision Date: 11/06/18 Archive Date: 11/06/18 DOCKET NO. 15-20 387 DATE: November 6, 2018 ORDER Recovery of overpayment for educational benefits in the amount of $10,419.13 is waived. FINDING OF FACT The competent and probative evidence is at least in equipoise in showing that the waiver of the overpayment in this instance would not be against the principles of equity and good conscience. CONCLUSION OF LAW The criteria for waiver of recovery of overpayment for educational benefits in the amount of $10,419.13 have been met. 38 U.S.C. §§ 5107, 5302(a); 38 C.F.R. §§ 1.962, 1.965. REASONS AND BASES FOR FINDING AND CONCLUSION The Veteran served on active duty from June 2005 to July 2014. This matter comes before the Board of Veterans’ Appeals (Board) on appeal from a November 2014 decision issued by a Department of Veterans Affairs (VA) Regional Office (RO). In September 2015, the Veteran, in Chicago, Illinois, testified before the undersigned at a videoconference hearing. A transcript of that hearing has been associated with the virtual file and reviewed. Entitlement to waiver of recovery of overpayment for educational assistance benefits in the amount of $10,419.13. An overpayment is created when VA determines that a beneficiary or payee has received monetary benefits to which he or she is not entitled. See 38 U.S.C. § 5302; 38 C.F.R. § 1.962. The preliminary issue of the validity of a debt is a threshold determination that must be made prior to a decision on a request for waiver of the indebtedness. See Schaper v. Derwinski, 1 Vet. App. 430 (1991). An overpayment of educational assistance benefits to an institution of higher learning on behalf of an eligible individual constitutes a liability of the individual unless the individual never attended the term, quarter, or semester certified by the institution of higher learning. 38 U.S.C. § 3323; 38 C.F.R. § 21.9695(b)(2). For an individual who does not complete one or more courses in the certified period of enrollment, but who substantiates mitigating circumstances for not completing such course or courses, VA will prorate the amount of educational assistance to which he or she is entitled. VA will determine the prorated amount of the established charges by dividing the amount the individual was paid for the course or courses not completed by the number of days in the certified enrollment period, and multiplying the result by the number of days from the beginning date of the enrollment period through the last date of attendance. The result of this calculation will equal the amount the individual is due. The difference between the amount of educational assistance paid and the amount of educational assistance the individual is due for the course or courses not completed will be established as an overpayment. 38 C.F.R. § 21.9695(b)(4)(ii). Once it is determined that the indebtedness was validly created, a finding of fraud, misrepresentation, or bad faith by the debtor in the creation of the overpayment precludes waiver of the overpayment. See 38 C.F.R. §§ 1.962, 1.965(b). If it is determined that there was no fraud, misrepresentation, or bad faith on the part of the debtor, VA must then consider whether collection of the debt would be against equity and good conscience. The phrase “equity and good conscience” means arriving at a fair decision between the obligor and the government. 38 C.F.R. § 1.965. In making this determination, consideration will be given to the following elements, which are not intended to be all-inclusive: (1) fault of the debtor–where actions of the debtor contributes to the creation of the debt; (2) balancing of faults–weighing fault of the debtor versus the fault of VA; (3) undue hardship–whether collection would deprive the debtor or family of basic necessities; (4) defeat the purpose–whether withholding of benefits or recovery would nullify the objective for which benefits were intended; (5) unjust enrichment–failure to make restitution would result in unfair gain to the debtor; (6) changing position to one’s detriment–reliance on VA benefits results in relinquishment of a valuable right or incurrence of a legal obligation. 38 C.F.R. § 1.965(a). In the evaluation of whether equity and good conscience necessitates a favorable waiver decision, the Board must consider all the specifically enumerated elements applicable to a particular case. Ridings v. Brown, 6 Vet. App. 544, 546 (1994); Cullen v. Brown, 5 Vet. App. 510, 512 (1993). If warranted, the Board may waive a portion of the debt. Jordan v. Brown, 10 Vet. App. 171 (1997). When, in fully weighing and balancing each equitable factor, there is an approximate balance of positive and negative evidence as to any material issue, VA shall give the Veteran the benefit of the doubt. 38 U.S.C. § 5107(b); see also Dela Cruz v. Principi, 15 Vet. App. 143, 148-49 (2001). The facts are not in dispute. The Veteran was in receipt of Post-9/11 GI Bill educational assistance benefits, under Chapter 33, Title 38, United States Code. The Veteran was attending The George Washington University (GWU) in pursuit of a graduate degree in security studies, and the Post-9/11 GI Bill educational assistance benefits were utilized to pay his tuition for the Fall 2014 semester. In mid-October, the Veteran received a job offer from the Federal Bureau of Investigation (FBI); he withdrew from his courses at GWU on October 16, 2014. In September 2015, the Veteran testified that he requested to defer the job start date until the end of the semester, but was advised that he had to start in two weeks and that if he declined the offer he would have no chance of future employment with the FBI. He further testified that he was pursuing a degree in security studies for the purposes of obtaining the exact type of job he was offered. Due to the nature of the FBI position and the training involved, the Veteran could not both work and complete his Fall 2014 courses. 09/03/2015, Hearing Testimony. The Veteran’s early withdrawal from the education program resulted in overpayment from VA in the amount of $16,180, which was the amount of tuition and fees paid by VA to GWU for the Fall 2014 semester. See 01/20/2014, Education. VA determined that the Veteran substantiated mitigating circumstances for not completing the Fall 2014 semester and after prorating the amount of the overpayment pursuant to 38 C.F.R. § 21.9695(b)(4), VA determined that the Veteran was liable for overpayment in the amounts of $9,404.13 in tuition and fees and $1,015 for a supplement payment, for a total overpayment of $10,419.13. 12/12/2014, Demand Letter. The Veteran testified that he paid the full amount owed in February 2015. The Veteran had not disputed the validity of the debt or the amounts of the overpayments, but has requested that the overpayment be waived because collection of the debt is against equity and good conscience. Initially, the Board finds that there is no evidence of fraud, misrepresentation, or bad faith on the part of the Veteran. The Board further finds that the overpayments should be waived because the evidence is at least in equipoise as to whether collection of the debt is against equity and good conscience. First, the Board finds that the debt did not result due to any fault on the part of the Veteran. Second, and most importantly, the Board finds that collection of the overpayments would defeat the purpose of the award of educational assistance benefits, which are to enable veterans to obtain the requisite training needed to find gainful employment. In the instant matter, the Veteran was pursuing a graduate degree in security studies in order to obtain the exact type of job offered to him by the FBI. Additionally, the Veteran testified that failure to accept the offer at that time would have precluded future employment at the FBI. As to undue hardship, the Veteran testified that payment of the debt required using several years of savings. Finally, the Board notes that failure to make restitution would not result in unfair gain to the Veteran. In light of all of the considerations set forth above, the Board finds that the question of whether recovery of the debt would be in violation of the principles of equity and good conscience is at least in equipoise. As such, the benefit-of-the-doubt is resolved in favor of the Veteran and waiver of the recovery of the overpayment in the amount of $10,419.13 is warranted in his case. 38 U.S.C. § 5107(b). Eric S. Leboff Veterans Law Judge Board of Veterans’ Appeals ATTORNEY FOR THE BOARD J.A. Gelber, Associate Counsel